Is Control4 Corporation (NASDAQ:CTRL) Overpaying Its CEO?

Martin Plaehn became the CEO of Control4 Corporation (NASDAQ:CTRL) in 2011. First, this article will compare CEO compensation with compensation at similar sized companies. After that, we will consider the growth in the business. And finally we will reflect on how common stockholders have fared in the last few years, as a secondary measure of performance. The aim of all this is to consider the appropriateness of CEO pay levels.

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How Does Martin Plaehn’s Compensation Compare With Similar Sized Companies?

Our data indicates that Control4 Corporation is worth US$518m, and total annual CEO compensation is US$1.7m. (This number is for the twelve months until 2017). While we always look at total compensation first, we note that the salary component is less, at US$400k. We examined companies with market caps from US$200m to US$800m, and discovered that the median CEO compensation of that group was US$1.5m.

So Martin Plaehn receives a similar amount to the median CEO pay, amongst the companies we looked at. This doesn’t tell us a whole lot on its own, but looking at the performance of the actual business will give us useful context.

The graphic below shows how CEO compensation at Control4 has changed from year to year.

NASDAQGS:CTRL CEO Compensation January 29th 19
NASDAQGS:CTRL CEO Compensation January 29th 19

Is Control4 Corporation Growing?

Control4 Corporation has increased its earnings per share (EPS) by an average of 49% a year, over the last three years (using a line of best fit). In the last year, its revenue is up 15%.

This shows that the company has improved itself over the last few years. Good news for shareholders. It’s also good to see decent revenue growth in the last year, suggesting the business is healthy and growing.

You might want to check this free visual report on analyst forecasts for future earnings.

Has Control4 Corporation Been A Good Investment?

I think that the total shareholder return of 197%, over three years, would leave most Control4 Corporation shareholders smiling. As a result, some may believe the CEO should be paid more than is normal for companies of similar size.

In Summary…

Martin Plaehn is paid around what is normal the leaders of comparable size companies.

The company is growing earnings per share and total shareholder returns have been pleasing. Although the pay is a normal amount, some shareholders probably consider it fair or modest, given the good performance of the stock. If you think CEO compensation levels are interesting you will probably really like this free visualization of insider trading at Control4.

Or you might rather take a peek at this analytical visualization of historic cash flow, earnings and revenue.

To help readers see past the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price-sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned. For errors that warrant correction please contact the editor at editorial-team@simplywallst.com.